1099 Contractor in South Dakota with a New Jersey Client: Where Do You File?
Answer
Usually nothing is due anywhere. As a South Dakota resident you file no state return, and New Jersey reaches only the part of your self-employment income that comes from work physically done inside New Jersey. Keep a record of any days you spend working on New Jersey soil.
Last verified
The most common contractor worry — that invoicing an out-of-state client creates a filing obligation there — is usually unfounded. What creates the obligation is physical presence, and South Dakota residents have no home-state return in any case.
New Jersey publishes no de minimis day count or dollar floor for nonresidents. Any New Jersey-source wage income above the state's general filing threshold requires a nonresident return, and that threshold is reset each year — check the current figure on the New Jersey Division of Taxation nonresident instructions before filing.
What you file
- 1Nonresident return · New JerseyForm NJ-1040NR
File a New Jersey nonresident return only for income from services you physically performed in New Jersey. South Dakota does not tax wage or self-employment income.
The two states, side by side
| South Dakota | New Jersey | |
|---|---|---|
| Taxes wages | No | Yes — graduated |
| Reciprocity partners | None | 1 (Form NJ-165) |
| Convenience rule | No | Only against convenience-rule states |
| Nonresident return | Not applicable | Form NJ-1040NR |
| Credit for other-state tax | No income tax | Schedule NJ-COJ |
| Nonresident safe harbour | Not applicable | None published |
| Local income tax | No | No |
| Revenue department | South Dakota Department of Revenue | New Jersey Division of Taxation |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in New Jersey and working in South Dakota gives:Home state only — estimated payments.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: South Dakota → New JerseyWork state only
- Remote worker: South Dakota → New JerseyNo state income tax on your wages
- Moved mid-year: South Dakota → New JerseyOne part-year return — the state you moved to
Other South Dakota pairs
Questions people actually ask
I live in South Dakota and my client is in New Jersey. Do I have to file a New Jersey tax return?
Usually nothing is due anywhere. As a South Dakota resident you file no state return, and New Jersey reaches only the part of your self-employment income that comes from work physically done inside New Jersey. Keep a record of any days you spend working on New Jersey soil.
Do reciprocity agreements help a 1099 contractor?
No. Every state reciprocity agreement in the country is an arrangement about wage withholding between two revenue departments, and a 1099 has no withholding to switch off. Whether South Dakota and New Jersey hold an agreement makes no difference to a self-employed filer — sourcing rules decide the answer instead.
How current is this?
The South Dakota and New Jersey rules on this page were last checked against South Dakota Department of Revenue and New Jersey Division of Taxation on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- South Dakota Department of Revenue — individual income taxaccessed 2026-08-07
- New Jersey Division of Taxation — individual income taxaccessed 2026-08-07
- New Jersey Division of Taxation — Convenience of the Employer Ruleaccessed 2026-08-07